Measurement of Output, Inputs, and Total Factor Productivity in U.S. Agricultural Productivity Accounts

by Sun Ling Wang, Richard Nehring, Roberto Mosheim, and Eric Njuki

The U.S. Department of Agriculture (USDA) has been monitoring the U.S. farm sector’s productivity performance since the 1960s. Today, USDA, Economic Research Service (ERS) bases its U.S. agricultural productivity statistics on a sophisticated system of production accounts, drawing data from numerous sources. Between 1948 and 2021, total farm output grew by 1.46 percent annually. Over time, the input composition has changed, shifting from labor and land use to more use of intermediate inputs and durable capital assets. This report addresses how USDA, ERS measures output, inputs, and total factor productivity in its U.S. agricultural productivity accounts and how input quality changes are accounted for in the measurement.

Keywords: Hedonic approach, index number approach, U.S. agricultural productivity, total factor productivity (TFP)

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